Wednesday, April 24, 2013

Halliburton (HAL) Q1 2013 Earnings

Halliburton
Co. (HAL) reported Q1 2013 earnings premarket on April 22, 2013.They reported income from continuing
operations for the first quarter of $624 million, or $.67 per diluted share.This value excludes a $637 million
charge, after-tax or $.68 per diluted share, which is a result of an increase
in the reserve for settlement payments from the Macondo litigation.With this litigation expense added in
the reported loss from continuing operations was $13 million, or -$.01 per
diluted share.

Halliburton’s
$.67 per diluted share, beat consensus estimates of $.58 for the quarter, which
makes this the 4 quarter of the last 5 that Halliburton has outperformed their
estimates.This news resulted in a
price increase of 5.59% to a closing price of $39.29.

Halliburton’s
reported revenue for the first quarter was $7.0 billion, which came in higher
than 2012’s revenue of $6.9 billion.The expanding international business was easily able to offset the
reduction in rig counts we saw during the first quarter within the North
America.As rig counts dropped 3%
within North America, sequential revenues declined 1%, while operating income
increased 30% as we saw margins improve by nearly 400 basis points due to lower
guar costs. Over the coming quarters we expect to see margins continue to
improve as customer activity increases, and modest price increases take
hold.

International
revenues for the firm grew by 21% in comparison to Q1 2012, which means the
company has shown the best year-over-year international growth for the past 4
quarters in comparison to competitors. Middle East/Asia region saw great
improvement due to increases in services provided within China, Australia, and
Saudi Arabia. Europe/Africa/CIS improved as drilling offshore of West Africa
continued and North Sea operations picked up.Latin America saw revenues increase 21%, but operating
income declined 11% due to increased movement of rigs in Brazil and a reduction
in the rig count of Mexico.